Brokerage firm analyst sees Apple Services alone worth $111-$177 a share by 2020

Brokerage firm analyst sees Apple Services alone worth $111-$177 a share by 2020
Apple has already let it be known that it has a goal to increase its Services revenue from $30 billion during fiscal 2017, to $50 billion by fiscal 2020. Jefferies analyst Timothy O'Shea told clients in a note today that he sees the Services division contributing as much as 25% of corporate revenue and 40% of gross profit by 2020. The analyst figures that the Services business deserves to be valued higher than Apple's low margin hardware business. As a result, O'Shea sees Apple Services alone worth $111 to $177 a share in two years.

CNBC notes that the analyst initiated coverage of Apple today as a "buy," pointing out that the iPhone serves as a "foundation" from which the company can "build a massive, recurring and high margin Services business." O'Shea says Services growth will be led by paid apps purchased from the App Store, and from Apple Music subscriptions. He also sees Apple adding new services over the coming years.


Jefferies has a one-year price target on Apple of $265. The shares closed today at $212.24, so the target price would represent a 25% gain from the current price.

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8 Comments

1. CreeDiddy

Posts: 2276; Member since: Nov 04, 2011

That’s insane! That’s more than at least 50% of Android revenue and profitability.

2. someguy2261

Posts: 261; Member since: Feb 12, 2016

Ha you wish by 2020 the stock market is going to be down by 50% a cross the board. So your apples now or cry later. And stop trying to get other people to buy you crap stocks. Stock are going to be discounted so don't buy nothing now.

3. Peaceboy

Posts: 640; Member since: Oct 11, 2018

Butthurt that even part of apple is more profitable than your garbage android.

4. rouyal

Posts: 1586; Member since: Jan 05, 2018

Just get an Apple and join a winning team! You’ll be less bitter and your QoL will improve. Maybe get a few of those years back you lost from stress from using android.

5. Finalflash

Posts: 4063; Member since: Jul 23, 2013

Get an "Apple"...I'm assuming you're the inbred offspring of this lady: https://youtu.be/l4q7mL5rLFs

7. rouyal

Posts: 1586; Member since: Jan 05, 2018

So Bitter and angry. I would be too if I had to use a ghetto phone with ghetto apps. You need to get an Apple, too.

6. mootu

Posts: 1541; Member since: Mar 16, 2017

This article lost all credibility when i read "The analyst figures that the Services business deserves to be valued higher than Apple's low margin hardware " Low margin?, i nearly fell off my chair laughing.

8. PHYCLOPSH

Posts: 654; Member since: Jun 28, 2014

I hope the world keeps faith in Apple. Not because I like iPhones (because I don't really like them) but because when Apple collapses, so will the U.S. economy and when you get laid off - you won't be able to buy any new phones then...

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